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EID Parry (India) Ltd.

BSE: 500125 | NSE: EIDPARRY |

Represents Equity.Intra - day transactions are permissible and normal trading is done in this category
Series: EQ | ISIN: INE126A01031 | SECTOR: Sugar

BSE Live

Nov 29, 16:00
441.90 -17.50 (-3.81%)
Volume
AVERAGE VOLUME
5-Day
17,115
10-Day
22,280
30-Day
27,736
15,484
  • Prev. Close

    459.40

  • Open Price

    459.40

  • Bid Price (Qty.)

    441.90 (1)

  • Offer Price (Qty.)

    441.90 (1)

NSE Live

Nov 29, 15:59
442.35 -17.40 (-3.78%)
Volume
AVERAGE VOLUME
5-Day
222,227
10-Day
322,781
30-Day
399,016
173,376
  • Prev. Close

    459.75

  • Open Price

    455.00

  • Bid Price (Qty.)

    442.35 (179)

  • Offer Price (Qty.)

    0.00 (0)

Annual Report

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Director’s Report

Your Directors have pleasure in presenting their Report together with the audited accounts for the financial year ended 31st March, 2007. The performance highlights of the Company for the year are summarised below: FINANCIAL RESULTS Rs Lakhs 2006-2007 2005-2006 Income from Operations 70718 97816 Profit Before Interest and Depreciation 20109 17766 Less: Interest (211) 739 Depreciation 3287 2915 Profit Before Tax 17033 14112 Provision for Tax: -Current (Net of MAT Credit) 1619 2650 -Deferred 2615 (275) -Fringe Benefit Tax 57 153 Profit After Tax 12742 11584 Add : Surplus brought forward 15554 11541 Balance in Profit and Loss Account of Amalgamating Company (1290) 9 Amount available for Appropriation 27006 23134 APPROPRIATIONS Transfer to General Reserve 3000 3000 Dividend on Equity Capital: Interim paid 4016 Proposed (Final) 1250 4016 Dividend Tax 776 564 Surplus carried to Balance Sheet 17964 15554 TOTAL 27006 23134 PERFORMANCE The Company achieved a turnover of Rs. 70718 lakhs including other income of Rs.15546 lakhs for the year ended 31sl March, 2007. The Profit Before Interest and Depreciation grew by 13% to Rs. 20109 lakhs and the Earning Before Tax was up by 21 % to Rs.17033 lakhs. The Profit After Tax (PAT) was Rs. 12742 lakhs (10%) compared to that of last year amounting to Rs. 11584 lakhs. The profit for the year includes Rs. 11812 lakhs representing income of a non recurring nature compared to Rs.2285 lakhs in previous year. Excluding this income (Rs.11812 lakhs) and the tax thereon (Rs.2640 lakhs) the Profit Before Interest and Depreciation was Rs.8297 lakhs, Profit Before Tax was Rs.5221 lakhs and the Profit After Tax (PAT) was Rs. 3570 lakhs. SUGAR With a bumper sugarcane crop and increased crushing capacities, sugar production in India has recovered in a short span of time to record levels resulting in high inventory build up. Further with untimely government intervention by banning exports of sugar, realisation has fallen sharply. Recent sugar price fall below cost of production has forced Government of India to review sugar industry policy comprehensively and the process is on. Unless both the State and Central Governments revise the policy realistically in terms of cane price, taxes thereon and export of Sugar and price and movement of Molasses and Ethanol this industry will be ruined. The country will face large cane payment arrears with consequent effect on the fortunes of farmers. Please refer to details provided in Management Discussion and Analysis report. The steep decline in sugar prices in the second half has restricted the revenue growth to about 22% over the previous fiscal while the operating profits has come down by about 61 %. However co-generation facilities and distillery contributed to the bottom-line significantly. The 18 MW co-generation plant commissioned at Pudukottai in March, 2006 got stabilised and become fully operational during the year. The 22 MW cogeneration power plant at Pugalur commenced commercial operations in March, 2007. The Ethanol and ENA projects at Nellikuppam Distillery is in progress and awaiting final clearance for operations from statutory authorities. The registration of the assets of New Horizon Sugar Mills Ltd., Ariyur, Puducherry, acquired from Indian Bank under the SARFAESI Act on 24* March, 2005 was completed on 24* August, 2006 and the Ariyur Factory commenced operations during December, 2006 and commercial production in March, 2007. The long term strategy for the Sugar Division approved by the Board includes increasing crushing capacities in existing factories, acquisitions, creation of integrated sugar complexes to extract value from all parts of the cane stick and derisk the sugar business. These include setting up of a 20 MW co-generation plant at Pettavaittalai and increasing the overall crushing capacity to 22000 TCD. On completion of the projects, the annual sitgarproductrorr wouW increase to about 6 lakh tonnes, power generation would be 127 MW and distillery capacity would be 200 KLPD. JOINT VENTURE WITH CARGILL ASIA PACIFIC HOLDINGS PTE LIMITED The Company entered into a Joint Venture Agreement with Cargill Asia Pacific Holdings PTE Limited (Cargill), a wholly owned subsidiary of Cargill International, on 8th December, 2006. Consequent to this, the parties have made an initial subscription to the share capital of Parrys Sugars Refineries Private Ltd.(name since changed to Silkroad Sugar Private Limited). This company will set up a stand alone sugar refinery in Kakinada. Your Company holds 50% of the equity capital in this Joint Venture. BIO PESTICIDES The Bio Pesticides division of the Company has emerged as a significant supplier in the Neem based bio-pesticide business and continues to focus on its core product - the NEEMAZAL range of products. The division is concentrating on development of new products like formulation for combined fungicide and insecticide activity. The Division clocked a revenue of Rs.2261 lakhs. Export revenues registered a growth of 13% over the previous year, with Americas and Europe continuing to be the major markets. With the launch of AVANA, a neem based bio pesticide granule, the Company is looking forward to gain position in Sugarcane and Rice in domestic market. NUTRACEUTICALS Parry Nutraceuticals Limited (PNL) became a wholly owned subsidiary during the year. Your Board considered it desirable to amalgamate PNL with the Company with effect from 1st September, 2006 and accordingly approved a Scheme of Amalgamation between PNL and EID at the Board meeting held on 191 October, 2006. Based on the petition filed by PNL with the Honble High Court of Judicature at Madras under Sections 391 to 394 of the Companies Act, 1956 for sanctioning the Scheme of Amalgamation, the Honble High Court vide its order dated 17th April, 2007 has approved the Scheme of Amalgamation as well as dissolved PNL without the process of winding up. Nutraceuticals is now functioning as a Division of the Company. The products of Nutraceuticals Division are currently exported to 35 countries in the world which continued to grow in all the markets serviced by it. Organic Spirulina, the main product of this business continues to outperform competition in its segment. In the current year the division made inroads into New Zealand selling Organic Spirulina to one of the largest brands of Nutraceuticals worldwide. The Organic Spirulina produced by your Company is the most certified Organic Spirulina in the world with 5 quality certifications and 3 Organic Certifications to its credit. The Organic Spirulina of the division was certified to meet stringent standards such as US Pharmacopeia, USDA and Naturland - Germany. For the 7 months period ended 31st March, 2007, the division registered a turnover of Rs.1112 lakhs. The performance of the various divisions during the year 2006-07 is given in detail in the Management Discussion and Analysis Report forming a part of this report. DIVIDEND Considering the one time profit of Rs. 118.12 crore being profit on sale of shares of Parryware Glamourooms Private Ltd. to Roca Sanitario S.A., your Directors declared a special interim dividend of Rs.4.50 (225%) per equity share of Rs.2/- each fully paid up, for the year ended 31st March, 2007 and the same was paid during August 2006. Your Directors are pleased to recommend a final dividend of Rs. 1.40 (70 %) per equity share of Rs.2 /- each for the financial year ended 31st March, 2007. With this the total dividend declared for the year ended 31st March, 2007 is Rs.5.90 (295%) per equity share of Rs.2/- each. CORPORATE DEVELOPMENTS PARRYWARE On 1st June, 2006 the Company transferred 4,32,580 equity shares of Rs.10 each held by the Company in Parryware Glamourooms Private Limited (PGPL), in favour of Roca Sanitario S.A. of Spain, (Roca) for a consideration of about Rs.118.55 crore. The PGPL Board also allotted 6,34,840 equity shares of Rs.10 each of PGPL to Roca on the same day. Consequent to this PGPL ceased to be a subsidiary of EID with effect from 1sl June, 2006 and became a joint venture company in which EID and Roca hold 50% equal stake in the capital. The name of the Company also has been changed to Parryware Roca Private Limited. SUBSIDIARY COMPANIES Coromandel Fertilisers Limited . Coromandel Fertilisers Limited (CFL) achieved a turnover of Rs.2084.22 crore for the year ended 31st March, 2007 and the Profit after Tax was Rs.100.74 crore. The Companys Board had recommended a dividend of 100 % for the year. CFL increased its stake in Godavari Fertilisers & Chemicals Limited (GFCL) from 45.07% to 74.92% and consequently GFCL became a subsidiary of CFL with effect from 12th April, 2007. Parry Chemicals Limited Parry Chemicals Limited, a 100% subsidiary of CFL, achieved a turnover of Rs. 85.35 lakhs for the year ended 31st March, 2007. The Profit after Tax was Rs.0.48 lakhs. With the surplus of Rs. 74.64 lakhs brought forward, the balance of Rs.75.12 lakhs was carried to Balance Sheet. Parrys Sugar Limited During the first year of operations, the Companys turnover was Rs. 11.15 lakhs and the Profit after Tax was Rs. 9.66 lakhs. Parry Infrastructure Company Private Limited The Company incorporated in January, 2006 to engage in infrastructure projects like development of Special Economic Zones (SEZ), etc. became a wholly owned subsidiary during the year. The Company proposes to promote a food processing SEZ and is taking necessary steps for implementation of this. Parry America Inc. Parry America Inc, the 100% subsidiary based in US, reported an income of US$ 32.20 lakhs for the year ended 31st March, 2007. The Profit After Tax was US$ 0.94 lakhs. After adjusting the carried forward loss of US$ 0.73 lakhs, the profit carried forward for the year was US$ 0.21 lakhs. The main business of this Company is to market and sell NeemAzal Technical in US markets and trading of technical and formulations in Western Countries. Parrys Investments Limited The Company has reported a business income of Rs.1.38 lakhs and made a Net Profit after Tax of Rs. 1.03 lakhs for the year ended 31st March, 2007. Coromandel Bathware Limited There was no operation during the year and the loss carried forward for the year was Rs. 193.36 lakhs. SUBSIDIARY ACCOUNTS In terms of the approval granted by the Central Government u/s 212 (8) of the Companies Act, 1956, copies of the Balance Sheet, Profit & Loss Account, Reports of the Board and the Auditors of all the Subsidiary Companies have not been attached to the Balance Sheet of the Company as at 31st March, 2007. However as directed by the Central Government, the financial data of the subsidiaries have been separately furnished forming part of the Annual Report. These documents will also be available for inspection at the Registered Office of the Company and the concerned subsidiary companies, during working hours up to the date of the Annual General Meeting. However, the related detailed information of the Annual Accounts of the Subsidiary Companies will be made available to the Holding and Subsidiary Companies investors seeking such information at any point of time. The Annual Accounts of the Subsidiary Companies will also be kept for inspection by the investors at the Registered Office of the Company and that of the Subsidiary Companies concerned. CONSOLIDATED FINANCIAL STATEMENTS The Consolidated Financial Statements have been prepared by the Company in accordance with the applicable Accounting Standards (AS- 21, AS-23 and AS-27) issued by the Institute of Chartered Accountants of India and the same together with Auditors Report thereon form part of the Annual Report. DIRECTORS Mr. S.M.Datta, Chairman, retired at the Annual General Meeting held on 19th July, 2006 and Mr.A.Vellayan took over as Chairman. IDBI withdrew the nomination of Mr.Biswajit Choudhuri with effect from 19th July, 2006. Mr.V.Thyagarajan, resigned from the Board with effect from 19th March, 2007. The Board places on record its grateful appreciation of the guidance provided, services rendered and valuable contributions made by Mr.S.M.Datta as the Chairman of the Board as well as the Chairman of the Audit Committee and Remuneration and Nomination Committee of the Board, by Mr.Biswajit Choudhuri and Mr.V.Thyagarajan as Directors and members of the Audit Committee of the Board during their respective tenure. Mr.A.Vellayan, Chairman and Mr.S.Viswanathan, Director retire by rotation in terms of Articles 102 and 103 of the Articles of Association of the Company and being eligible, offer themselves for re-appointment. A brief resume, expertise and details of other directorships of these Directors is attached along with the Notice of the ensuing Annual General Meeting. CORPORATE GOVERNANCE Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, a Management Discussion and Analysis Report, Corporate Governance Report and Auditors Certificate regarding compliance of conditions of Corporate Governance are made a part of the Annual Report. Mr.P.Rama Babu, Managing Director and Mr.D.Kumaraswamy, Chief Financial Officer, have given a certificate to the Board as contemplated in Clause 49 of the Listing Agreement. TRANSFER TO THE INVESTOR EDUCATION AND PROTECTION FUND In terms of Section 205C of the Companies Act, 1956, an amount of Rs. 10.64 lakhs being unclaimed dividend, interest on fixed deposit, interest on debentures, unclaimed deposits etc. was transferred during the year to the Investor Education and Protection Fund established by the Central Government. DEPOSITS 14 deposits totalling to Rs. 1.26 lakhs due for repayment on or before 31st March, 2007 were not claimed by the Depositors on that date. Efforts are being made to contact all such deposit holders to facilitate the refund to them. The Company has discontinued acceptance of deposits since July 2003. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors confirm that, to the best of their knowledge and belief: in the preparation of the Profit & Loss Account for the financial year ended 31st March, 2007 and the Balance Sheet as at that date (financial statements), applicable Accounting Standards have been followed; appropriate accounting policies have been selected and applied consistently and such judgements and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at the end of the financial year and of the profit of the Company for that period; proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. To ensure this, the Company has established internal control systems, consistent with its size and nature of operations. In weighing the assurance provided by any such system of internal controls its inherent limitations should be recognised. These systems are reviewed and updated on an ongoing basis. Periodic internal audits are conducted to provide reasonable assurance of compliance with these systems. The Audit Committee meets at regular intervals to review the internal audit function; the financial statements have been prepared on a going concern basis. AUDITORS M/s. Deloitte, Haskins & Sells, Chartered Accountants, Chennai, the Companys Auditors, retire at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Board, on the recommendation of the Audit Committee, has proposed that M/s. Deloitte Haskins & Sells, Chartered Accountants, Chennai be re-appointed as the Statutory Auditors of the Company and to hold office till the conclusion of the next Annual General Meeting of the Company. M/s. Deloitte Haskins & Sells, Chartered Accountants, Chennai have forwarded their certificate to the Company, stating that their re-appointment, if made, will be within the limit specified in that behalf in Sub-section (1B) of Section 224 of the Companies Act, 1956. COST AUDITOR The Company received the approval of the Central Government for appointment of Mr.D.Narayanan as Cost Auditor to conduct the cost audits for the financial year 2006-07. PARTICULARS OF EMPLOYEES Under the provisions of Section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of employees are set out in the Annexure to the Directors Report. ACKNOWLEDGEMENT The Directors thank the customers, suppliers, farmers, financial institutions, banks and shareholders for their continued support and also recognise the contribution made by the employees to the Companys progress during the year under review. On behalf of the Board Chennai A VELLAYAN May 4,2007 Chairman

Director’s Report